A four-year senior unsecured loan of up to €25 million in hryvna equivalent to be provided to LLC OTP Leasing for on-lending to eligible micro, small and medium-sized enterprises ("MSMEs") under SME Competitiveness Programme in Eastern Partnership. In addition to long-term financing, eligible sub-borrowers will receive technical assistance funded by the EU and grant support in the form of investment incentives upon the completion of their investment projects.
The project will enable the company to finance long-term investments of Ukrainian MSMEs in upgrading their technology and equipment necessary to meet EU standards in terms of product quality, health and safety measures and environmental preservation. At least 80 per cent of all financed sub-loans are expected to be compliant with EBRD Green Economy Transition (GET) approach.
ETI score: 75
Competitive: the company will expand its MSME portfolio, with a focus on financing priority investments complying with EU directive(s), ultimately facilitating competitiveness of Ukrainian MSMEs; and
Resilient: the company is expected to maintain adequate MSME portfolio quality.
OTP LEASING LLC
The leading leasing company in Ukraine with about 38% market share in terms of leasing portfolio as of end-Q3 2021 with stable financial position, proven track record and a viable business model. It provides financial leases and fleet management services to corporate and MSME clients across the country and is ultimately owned by OTP Bank Plc (Hungary).
EBRD Finance Summary
Total Project Cost
Key sources of additionality under the project are: (i) financing structure (long term local currency financing supporting longer investments), and (ii) knowledge, innovation and capacity building (technical assistance under the programme will support timely realisation of EU-compliant investments in Ukraine).
Environmental and Social Summary
Categorised FI (ESP 2019). OTP Leasing is an existing client and has already developed an Environmental Social Monitoring System ("ESMS") which includes implementation of environmental and social risk management policies in line with PR9. For the proposed transaction, OTP Leasing will be required to continue to comply with EBRD's PRs 2, 4 and 9 policies and procedures, implementing EBRD's E&S Risk Management Procedures for Leasing Companies, which include adherence to EBRD's Environmental and Social Exclusion List and submission of Annual E&S Reports to the Bank. OTP Leasing's borrowers will be required to comply with applicable national environmental, health and safety and labour requirements. The project is consistent with the GET approach and the GET share is 80%.
Technical Cooperation and Grant Financing
MSME sub-borrowers will benefit from financial incentives (up to 10 per cent of the lower of sub-loan disbursed amount or investment cost) for eligible sub-projects, while OTP Leasing will receive technical assistance from dedicated consultants towards investment projects preparation and implementation.
Company Contact Information
Kyiv region, Petropavlivska Borshchahivka village, Ozerna str., 5, 08130
PSD last updated
11 Feb 2022
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Independent Project Accountability Mechanism (IPAM)
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